A blog exploring the intersection of economic thinking and urban planning/real estate development and related big-think themes.

Friday, December 21, 2012

Hard work

Matt Ridley (in the Dec 19 WSJ) wrote about "Cooling Down the Fears of Climate Change ... Evidence points to a further rise of just 1 degree C by 2100. The net effect on the planet may actually be beneficial." So it was interesting to look at the Dec 24/31 New Yorker and find Keith Gessen's "Polar Express ... A journey through the melting Arctic, with sixty-odd thousand tons of iron ore." It is a detailed account of a haul of iron ore from Murmansk, Russia, to Huanghua, China, via a new Northeast Passage, that is now available because of ice melt. The author notes savings (including less fuel burned) over alternative routes via Suez or around the Cape of Good Hope.

People have been looking for better trade routes through most of recorded history. Polar Express is simply the latest example. Most of the inhabitants of the Americas, for example, are where they are as a result of such explorations. (There are, of course, politicians now seeking to block U.S. natural gas exports, claiming that not trading would be a benefit to the U.S. economy.)

Climate change is not new and those seeing opportunities will seek to realize them. As Ridley suggests, it is not all bad news. Besides, who believes that we can extrapolate anything to 2100 with any confidence? On the other side, Gessen notes the irony that the haul he accompanied was moving iron ore to China where it would be combined with coal to yield new steel as well as extra carbon into the atmosphere. Irony on irony would be U.S. natural gas exports to China, enabling them to burn less coal.